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John Fund compares the business climates of Texas versus California.
…The contrast is undeniable. Texas has added 165,000 jobs during the last three years while California has lost 1.2 million. California’s jobless rate is 12% compared to 8% in Texas.
…Hours after the legislators met with Mr. Perry, another business, Fujitsu Frontech, announced that it is abandoning California. “It’s the 70th business to leave this year,” says California business relocation expert Joe Vranich. “That’s an average of 4.7 per week, up from 3.9 a week last year.” The Lone Star State was the top destination, with 14 of the 70 moving there.
Andy Puzder, the CEO of Hardee’s Restaurants, was one of many witnesses to bemoan California’s hostile regulatory climate. He said it takes six months to two years to secure permits to build a new Carl’s Jr. restaurant in the Golden State, versus the six weeks it takes in Texas. California is also one of only three states that demands overtime pay after an eight-hour day, rather than after a 40-hour week. Such rules wreak havoc on flexible work schedules based on actual need. If there’s a line out the door at a Carl’s Jr. while employees are seen resting, it’s because they aren’t allowed to help: Break time is mandatory.
“You can’t build in California, you can’t manage in California and you have to pay a big tax,” Mr. Puzder told the legislators. “In Texas, it’s the opposite—which is why we’re building 300 new stores there this year.” …
Ed Morrissey comments on John Fund’s article.
When California politicians want to visit California jobs, they increasingly have to leave California to do so. That’s why Lt. Governor Gavin Newsom traveled with a small entourage of other Golden State politicians to Texas, the biggest beneficiary of California’s economic policies. So many jobs have fled California to Texas, John Fund writes for the Wall Street Journal, that the governing class needed lessons from Texas Governor Rick Perry on how not to repel business…
…The state needs to rid itself of its penchant for regulation, especially demonstrated in the episode concerning the California Air Resource Board’s use of a questionable study authored by an academic fraud that not only threatens to put independent trucking companies out of business, but also honest scientists that blow the whistle on the unseemly relationship between state-based Academia and regulatory boards such as CARB.
And that doesn’t even start to address California’s ridiculously high taxes, and the overly progressive nature of its income tax system that guarantees revenue crashes during economic downturns.
Until Californians come to grips with the fact that they have overregulated the state into non-competitiveness, taxed it to the point of overwhelming investor risk, and continue to spend far beyond its means, jobs will continue to disappear from the Golden State at a rapid pace. …
Robert Samuelson criticizes the president for not getting serious about the budget.
…The president keeps promoting an “adult conversation” about the budget, but that can’t happen if the First Adult doesn’t play his part. Obama is eager to be all things to all people. He’s against the debt and its adverse consequences, but he’s for preserving Social Security and Medicare without major changes. He’s for “tough cuts,” but he’s against saying what they are and defending them. He pronounces ambitious goals without saying how they’d be reached. Mainly, he’s for scoring political points against Republicans.
…Given better health, longer life expectancy and wealthier elderly, why shouldn’t Social Security and Medicare eligibility ages be raised and means-testing broadened? The president doesn’t broach this debate. Farmers receive about $15 billion a year in crop subsidies to help offset the insecurities of weather and fluctuating prices. Considering that volatile markets impose similar insecurities on many Americans, why do farmers deserve special protection? The president doesn’t engage that debate. Might not a higher gasoline tax reduce budget deficits and oil imports? Obama is silent there, too.
All this may be politically shrewd. Voters disdain hard choices. Liberal pundits loved Obama’s speech. But another audience is less impressed — global money managers. The Financial Times’ respected columnist Gillian Tett recently asked whether the administration’s “reassuring patter on debt” could be believed. Not entirely, she concluded. Shortly thereafter, Standard & Poor’s warned that it might downgrade U.S. government debt. Obama is flirting with trouble, even if he doesn’t realize it.
In the WaPo, Charles Lane looks at the fiscal train wreck that is China’s high speed rail project.
…Liu’s legacy, in short, is a system that could drain China’s economic resources for years. So much for the grand project that Thomas Friedman of the New York Times likened to a “moon shot” and that President Obama held up as a model for the United States.
…The fact is that China’s train wreck was eminently foreseeable. High-speed rail is a capital-intensive undertaking that requires huge borrowing upfront to finance tracks, locomotives and cars, followed by years in which ticket revenue covers debt service — if all goes well. “Any .?.?. shortfall in ridership or yield, can quickly create financial stress,” warns a 2010 World Bank staff report.
Such “shortfalls” are all too common. Japan’s bullet trains needed a bailout in 1987. Taiwan’s line opened in 2007 and needed a government rescue in 2009. In France, only the Paris-Lyon high-speed line is in the black. …
We have more commentary from Ed Morrissey on the NRLB’s recent power grab. Your government at work for the unions.
I’ve heard plenty of people dismiss Atlas Shrugged (the book as well as the movie) as overwrought, contrived paranoia about the regulatory state. The government can’t run companies through its regulatory system, critics scoff, no matter what a Russian ex-patriate thought more than 50 years ago. No one is marching into manufacturers in the US and telling the Hank Reardons of the world what they can build and where.
…The NLRB obliged with its complaint yesterday asking an administrative law judge to stop Boeing’s South Carolina production because its executives had cited the risk of strikes as a reason for the move. Boeing acted out of “anti-union animus,” says the complaint by acting general counsel Lafe Solomon, and its decision to move had the effect of “discouraging membership in a labor organization” and thus violates federal law.
Ah, that must be the Anti Dog-Eat-Dog Law, or one of the Fairness Laws, or something, right? The WSJ isn’t sure what law the NLRB is talking about, either. Not only do businesses routinely relocate to find the most advantageous environment possible, states and cities compete for that business by calculating their business climate. …
In the Washington Examiner, Timothy Carney explains that the Boeing-NRLB story is even more interesting than it first appears.
…This extraordinary abridgement of economic freedom might suggest an anti-Boeing vendetta from President Obama, except that this administration’s Export-Import Bank has subsidized Boeing with nearly $15 billion in loan guarantees in the past two years — roughly three-quarters of all of Ex-Im’s guarantees during that time.
…Boeing and Obama, both based in Chicago, have a real political friendship. In 2008, Obama was by far the biggest recipient of campaign contributions from Boeing employees and executives, hauling in $197,000 — five times as much as John McCain, and more than the top eight Republicans combined.
Boeing’s lobbyists include some of Obama’s closest allies. The Podesta Group, co-founded by Obama’s transition director and John Podesta, represents the jet maker, with Democratic fundraiser Tony Podesta and former Obama campaign aide and administration official Oscar Ramirez as two of the lobbyists on the account. Linda Daschle, wife of Obama confidant Tom Daschle, is a longtime Boeing lobbyist.
…In fiscal 2009, 2010 and 2011 so far, Boeing has received more than $45 million in government contracts. Documents made public by Wikileaks showed how much work U.S. diplomats do to persuade foreign leaders to buy Boeing jets for their state-owned airlines. …
In the NY Times, Steven Greenhouse has more on the liberal turn at the NLRB.
…The Boeing case was not the first time that Mr. Solomon has riled the business community and its Republican allies. Saying it is the domain of the federal government, he recently threatened to sue four Republican-heavy states — Arizona, South Carolina, South Dakota and Utah — in an effort to invalidate recent constitutional amendments that prohibit private sector workers from choosing a union by signing cards, a process known as card check.
He has also sought to extend the labor board’s reach into the world of the Internet. He approved requests from regional labor board officials to bring complaints against businesses that punished employees for Facebook and Twitter posts, including one case against Reuters. Mr. Solomon has also proposed that electronic voting be used when workers decide whether they want to unionize their workplace — a proposal that business groups maintain will make it easier for unions to coerce workers.
In an interview, Mr. Solomon, a 61-year-old Arkansas native, insisted that he was no radical. …
Mark Steyn had contraband confiscated at the border.
I am looking this bright Easter morn at a Department of Homeland Security “Custody Receipt for Seized Property and Evidence”. Late last night, crossing the Quebec/Vermont border, my children had two boxes of “Kinder Eggs” (“Est. Dom. Value $7.50?) confiscated by Customs & Border Protection. …
…Kinder Chocolate Eggs are hollow milk chocolate eggs about the size of a large hen’s egg usually packaged in a colorful foil wrapper. They are a popular treat and collector’s item during holiday periods in various countries around the world, including those in Europe, South America and even Canada. A toy within the egg is contained in an oval-shaped plastic capsule. The toy requires assembly and each egg contains a different toy. Many of the toys that have been tested by the Consumer Product Safety Commission in the past were determined to present a choking hazard for young children.
And yet oddly enough generations of European and Latin American children remain unchoked. …
…PS My kids asked the CBP seizure squad if they could eat the chocolate in front of the border guards while the border guards held on to the toys to prevent any choking hazard – and then, having safely consumed the chocolate, take the toys home as a separate item. This request was denied. Could have been worse. Could have been a $300 fine, plus a $250 fee for seized-egg storage.
PPS The real choking hazard is the vise-like grip of government.